Abnormalities of the endosomal-lysosomal system occur in Alzheimer's disease (AD). Relatively little is known about multivesicular endosomes and their contributions to AD pathogenesis and maintenance of neuronal homeostasis, including exosome biogenesis and function. Our preliminary findings suggest that endosomal-lysosomal system dysfunction in AD, which prevents efficient transport and degradation of substrates, can be compensated for by enhanced secretion of exosomes containing neuroprotective factors along with toxic proteins. In Aim 1 we will determine whether endosomal dysfunction (examined in Projects 1 and 4) and autophagic dysfunction (Project 2) affect exosome generation and secretion in mouse disease models. In Aim 2, using in vivo and in vitro models, we will study the effects of enhancing or inhibiting lysosomal system function on exosome secretion and the reciprocal effects of enhancing or inhibiting exosome generation on AD-related lysosomal pathology. We demonstrated that cystatin C (CysC) can induce beneficial autophagic and lysosomal degradation and can also enhance exosomal secretion, resulting in neuroprotection. Both extracellular soluble human CysC and exogenous exosomes containing CysC protect cells from death. We propose that CysC can regulate whether proteins are directed to autophagic vesicles for lysosomal degradation or for release into the extracellular space via exosomes, and that both pathways potentially rescue deleterious effects of AD-related dysfunctions of the lysosomal system. In Aim 3 we will test this hypothesis, demonstrating that reduced CysC levels, which are associated with AD, deprive cells of the protection provided by both soluble CysC and CysC-loaded exosomes. We will further determine whether therapeutic strategies that restore or enhance CysC activity will attenuate AD pathologies. Exosomal membrane-encased proteins are more stable than soluble proteins in the extracellular environment, offering long-lived and potentially spatially distant neuroprotective effects. Thus, exosomes released from cells in the central nervous system may have important protective functions, and CysC-loaded exosomes are a potential therapeutic strategy for the treatment of AD and other neurodegenerative disorders.